Small firms say regulation is fastest-growing concern
It’s been exactly three and a half years since Barack Obama was inaugurated, and here are two things that folks on the left have been saying about the economy every day since then: It’s Bush’s fault, and the problem is a lack of aggregate demand.
Here’s what small businesses have to say about the situation:
Chart by Dan Clifton at Strategas Research, via the AEIdeas blog
Keeping in mind that these are what small firms are “most concerned” about, meaning many likely have concerns to varying degrees about all three, a few things jump out at me:
1. In 2005, these three concerns accounted for a little more than one-third of small firms’ biggest worries. Today, they combine for about 60 percent. That suggests to me that these firms have less time and energy to devote to specific concerns about growing their business.
2. After shooting to the top in the second half of 2008, concerns about sales plateaued for about two years. Those concerns have been falling pretty steadily for the past year and a half.
3. Concerns about regulation, which more or less mirrored those about sales from 2005 to the start of 2008, began a steady ascent in 2009 and have almost doubled since then.
4. Concerns about taxes have remained fairly steady over these years.
5. At the beginning of 2009, the sum of concerns about regulation and those about sales was in the neighborhood of 40 percent — pretty much the same as today. But the division between them is starkly different: Whereas there were three small firms concerned about sales for every one worried about regulation then, now the two are dead even. In other words, worries about sales have been gradually replaced by worries about regulation.
6. If current trend lines continue, both taxes and regulation will soon rank higher among small firms’ concerns than sales.
Even if one wants to credit Obama’s “stimulus” package with the decrease in worries about sales — totally ignoring the effects of the Federal Reserve’s ultra-loose monetary policy — this graph clearly shows why improved demand hasn’t shifted the economy out of neutral: Increased regulation has stifled the recovery we might have had.
Small firms are generally credited with the bulk of job creation in this country. So the question this information puts to voters is: Which candidate do you expect to do more about the most pressing problems faced by small firms — Barack Obama or Mitt Romney?
– By Kyle Wingfield
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575 comments Add your comment
They BOTH suck
July 20th, 2012
3:18 pm
Filter
Ask on if you have the notion. No blogger has been given the authority to tell or suggest you shut up.
Everyone have a great weekend.
Lil' Barry Bailout - Vote American
July 20th, 2012
3:19 pm
“In certain industries and companies there is a lack of aggregate demand”
———
And Kyle’s post explains why small businesses aren’t spending.
Jefferson
July 20th, 2012
3:20 pm
If rather running from Chik, the gays should make say Thur night “their” night at Chik, holding hands and such, they after a while change to say Wed night and surprise the homophobes who would stay away to avoid them. Cathy is getting what he wants.
I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...
July 20th, 2012
3:24 pm
McCool- All Texans speak like that.
Balls in your court.
Some people are stupid
July 20th, 2012
3:25 pm
I find it funny when someone ask for a list of regulations, you simply point out a bill but not a regulation.
And on the state water thing. That seems really important..just saying.
Lil' Barry Bailout - Vote American
July 20th, 2012
3:26 pm
If you think Cathey is going to change his morals because of some freak show, you’re going to be disappointed.
md
July 20th, 2012
3:27 pm
“Cathy is getting what he wants.”
Not condoning his actions. but the guy is 91 years old…..I’m guessing he pretty much doesn’t care what others think……now cfa may have to worry about it, but I doubt he will.
Jefferson
July 20th, 2012
3:28 pm
I was thinking the son made the comments.
Finn McCool (The System isn't Broken; It's Fixed)
July 20th, 2012
3:30 pm
Kyle, here is a weekend topic idea:
Should Women Have the Right to Go Topless in Public?
md
July 20th, 2012
3:30 pm
“I find it funny when someone ask for a list of regulations, you simply point out a bill but not a regulation.”
A bill is a regulation………..usually bunches of them grouped together………
As for the water……yep, it makes sense for someone to make the corps of engineers that are very shorthanded go out and tell a landowner…..”yep, that’s just a puddle”………which is what they did with us after waiting 10 months……….
Jefferson
July 20th, 2012
3:31 pm
I don’t expect Cathy to change any morals — if the chain got labeled “gay” his customers would stay home. You have been to chick right ?
md
July 20th, 2012
3:31 pm
“I was thinking the son made the comments.”
Probably did, but more than likely not without daddy’s guidance……
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
3:39 pm
“I find it funny when someone ask for a list of regulations, you simply point out a bill but not a regulation.”
Written by someone who has never studied the legislation process or passed Civics 101 (or actually passed a law) in their lifetime.
Bills are nothing BUT regulations, with the lone exception of proclamations – you know – things like “Treat a liberal with kindness because they are so dense” day.
Jefferson
July 20th, 2012
3:40 pm
Just another choice, he made…
I'm a liberal and believe everything I read and nothing the other side comes up with...cause we're smart and they are not
July 20th, 2012
3:43 pm
I don’t think Chick fil a is worried, because if you landed here from Mars last week and started listening to the news, the radio, movies, TV, Washington, you would think the country is about 1/3 Gay. It’s about 2% or less Gay. It’s just the Business model is so strong.
Some people are stupid
July 20th, 2012
3:45 pm
By that accoutn then, wouldn’t it make more sense to then compare this administration to otheres by the amount of bills passed, since bills are just regulations?
On another note, regulations can create jobs as well. I find it funny that people say cost to a business, that cost usually goes towards the creation of another business or job. See Sarbanes Oxley, the cost incurred to the business were A. hiring more internal auditors and people to properly use controls, and B. Hiring an outside accounting firm to audit, who in turn hired more auditors.
Tom
July 20th, 2012
3:46 pm
If you actually believe that Chick-Fil-A does anything for any reason other than focus-group-tested marketing purposes, your childlike credulity is really touching.
Jefferson
July 20th, 2012
3:49 pm
Tom, you may be right… he made the statement to run away a segment of customers that he feels he can live without, if that is what the will do.
Jefferson
July 20th, 2012
3:49 pm
s/b they will do.
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
3:52 pm
“By that accoutn then, wouldn’t it make more sense to then compare this administration to otheres by the amount of bills passed, since bills are just regulations?”
I’ll re-post a comment I showed JDW earlier.
“Further, the Post goes on to say: “Still, it’s worth noting that the number of “economically significant” regulations — meaning those that are expected to have a positive or negative impact on the economy of at least $100 million — has increased from 126 during Bush’s last three years to 177 during Obama’s first three.”
And just how many regulations from the Federal government ever reach the “positive effect” threshold?”
Now, to your final comment: “On another note, regulations can create jobs as well. I find it funny that people say cost to a business, that cost usually goes towards the creation of another business or job. See Sarbanes Oxley, the cost incurred to the business were A. hiring more internal auditors and people to properly use controls, and B. Hiring an outside accounting firm to audit, who in turn hired more auditors.”
You DO realize that the regulations creating those jobs COSTS THE COMPANIES THAT HAVE TO CREATE / HIRE THEM MONEY, right?
Jefferson
July 20th, 2012
3:55 pm
Pass the cost on…just like a tax…huh
Filter
July 20th, 2012
4:00 pm
Tiberious,
I have no intention of shutting up other than the fact that I am done for the day and headed out.
My final thoughts here are these. I asked for a list of regulations because I knew you couldn’t come up with one. This is political propaganda, pure and simple, on the part of the right. Just another in a series of silly talking points and false allegations.
Sputtering out the ACA is not an answer and the simple fact is that you don’t have one. You and your compatriots had almost FOUR HOURS to produce a simple list of 10 small business strangling regulations and you couldn’t give me even one outside of the right’s favorite boogie man du jour, the ACA.
You can look all you like and all you’ll see is people talking about these evil and onerous regulations without one bit of specificity. But if you talk about it enough you’re bound to scare a few folks.
Kind of like War of the Worlds Mr. Wells.
Filter
July 20th, 2012
4:01 pm
And with that I go to fight traffic.
md
July 20th, 2012
4:01 pm
“Just another choice, he made…”
Although it is/was a choice, my original point was that it was made by a “corporation”……which many will say are not people. Last I checked, opinions come from people……..hence the fact that corporations are indeed “people”.
Some people are stupid
July 20th, 2012
4:02 pm
Tiberius-
You DO realize that the regulations creating those jobs COSTS THE COMPANIES THAT HAVE TO CREATE / HIRE THEM MONEY, right?
Is there a difference between one job at company A, or company A sending money to company B for a service and they hire one person.
That’s like me saying you know me going grocery shopping cost me money.
Money is not a finite linear change, it’s circular. My income is your revenue. In the case of a company, their revenue(or expense) is my income stream.
md
July 20th, 2012
4:04 pm
“See Sarbanes Oxley, the cost incurred to the business were A. hiring more internal auditors and people to properly use controls, and B. Hiring an outside accounting firm to audit, who in turn hired more auditors.”
One should not assume that just because it created jobs in one department it did not cost jobs in another………..if a corp only has xx dollars to spend on the expense of employees, that corp must actually move people around or fire others to comply with SO……
How Inciteful Is That!
July 20th, 2012
4:05 pm
Strategas Research. Hmmm. Oh yes. They used to be called HotAir Inc.
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
4:06 pm
In the case of groceries, you spend money because you are hungry or because you want to.
In the case of regulations, you spend money because you are forced to.
That I even had to spell that out to you speaks volumes.
md
July 20th, 2012
4:12 pm
“or company A sending money to company B for a service and they hire one person. ”
One must also remember that company B is also subject to SOX….may be a wash.
Some people are stupid
July 20th, 2012
4:12 pm
md-
same point applies still, in your example, if it cost jobs in one and created them in another, isn’t that a zero sum gain(assuming a 1 to 1 relationship)
Tiberius- In the context of jobs though, whether forced or not, did it not create a job. Just like the ACA(i think you used it as an example), does it not require more IRS workers(jobs), healthcare facilities seeing an increase of patients hire more staff(jobs), even insurance comapnies to process the payments(jobs), not including the secondary market(healthcare consultants, recovery analyst).
Jefferson
July 20th, 2012
4:15 pm
Private vs public corps, md …. if they are “people”, they should pay more taxes.
Artful Observer...
July 20th, 2012
4:15 pm
“In the case of regulations, you spend money because you are forced to.”
I am forced to disagree…..You are not forced to spend anything…..You always have choice in these type of matters….. You can comply and spend, you canfind a way around the regulation, or you can close up shop and try to find a business that will allow you to make some money with having to spend any money……
Some people are stupid
July 20th, 2012
4:17 pm
MD-
In the company A to B example, they were generic. If the SOX example was applied, comapny B would be a CPA firm, and only 5 I believe are public and would not be subject to SOX.
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
4:18 pm
You’re really going to hang your hat on that 4:15 post, Artful Observer?
REALLY?
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
4:21 pm
“Tiberius- In the context of jobs though, whether forced or not, did it not create a job.”
Yes. Your point?
Because being forced to shell out money to create a job takes money out of a business it can use to lower the cost of a product, pay their own people more, hire new people to actually make things, or simply make more money. Even upgrade their processes to become more efficient.
Something bad has to happen before you get your created job.
Dusty
July 20th, 2012
4:23 pm
Tiberius, 3:52
I am beginning to understand the policies of Obama a lot better. You asked:
“You DO realize that the regulations creating those jobs COSTS THE COMPANIES THAT HAVE TO CREATE/ HIRE THEM MONEY, right?”
A liberal here doesn’t even know that hiring more people in a company increases company costs.
I don’t think Obama knows THAT either. He also does not know that spending money you don’t have increases debt. That is the lack of simple knowledge that is running this country into the financial “ground”. His supposedly “greater knowledge” did not include common sense.
Artful Observer...
July 20th, 2012
4:23 pm
Tiberius, Not really hanging my hat on anything….. But where is the flaw in that statement????
Some people are stupid
July 20th, 2012
4:25 pm
Tiberius-
I thought our whole discussion was regulations can create jobs. Since you seem to have conceded that point…
Skip
July 20th, 2012
4:27 pm
The list of ten, never going to happen. But be afraid, be very afraid..
Lynnie Gal
July 20th, 2012
4:30 pm
This has nothing to do with whether or not businesses will hire. It’s a false notion that “regulation” is the reason the “job creators” haven’t created any jobs in over a decade. There is no link with “regulation” or with income taxes and job creation. That’s just right winger speak. If the “job creators” need tax breaks to create jobs, why haven’t they created jobs? They’ve had the Bush tax cuts for twelve years now. Still-no jobs. The regulation argument is just as lame.
Some people are stupid
July 20th, 2012
4:31 pm
Dusty-
A liberal here doesn’t even know that hiring more people in a company increases company costs
(Face plam) I thought that was understood and didn’t need to be spelled out. MY point was that an increase can be tied to a job created.
He also does not know that spending money you don’t have increases debt.
So what would you say to all the small business owners who finance their start-ups with debt. Isn’t that money they don’t have/
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
4:41 pm
Artful Observer, to go down each of your points (and again, I can’t believe I have to explain this stuff):
“You can comply and spend,”
Thereby proving my point.
” you canfind a way around the regulation,”
Encouraging lawlessness isn’t the way to advance society.
” or you can close up shop and try to find a business that will allow you to make some money with having to spend any money……”
First, can’t be done. You cannot start up a business without spending money complying with regulations. Second, again you’re making my point. If regulations are so bad that your choice is to fold up shop, this nation is doomed.
That this has to be explained to you points to this nation’s demise.
md
July 20th, 2012
4:42 pm
“same point applies still, in your example, if it cost jobs in one and created them in another, isn’t that a zero sum gain(assuming a 1 to 1 relationship)”
An awful lot of assuming to get to that 1 for 1……..if A doesn’t increase demand at B, it’s a net loss.
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
4:45 pm
“I thought our whole discussion was regulations can create jobs.”
No, stupid (and that is just a convenient shortening of your blog name – if you don’t like it, change it), YOU were making the point that regulations have a positive effect in creating jobs. I was pointing out that the positive effect you are relying on is negated by the negative effect of taking money away from a private firm to pay for those jobs.
Once again, a negative MUST occur before you get your additional job.
And again, that I have to explain that to you speaks volumes.
Some people are stupid
July 20th, 2012
4:45 pm
MD-
Not really, the regulation created the demand rememeber.(See SOX example)
It is just like any other law or rule on the books. If they passed a law saying all businesses must purchase the ajc, the demand was created by the law.
md
July 20th, 2012
4:46 pm
“You can comply and spend, you canfind a way around the regulation, or you can close up shop and try to find a business that will allow you to make some money with having to spend any money……”
Which is why our corps have 3 trillion dollars sitting offshore. Since the dems demand that they get 30% to bring it home, our corps have said OK, we’ll just ramp up our subsidiaries overseas……and that is what they are doing as it maximizes their capital……….
Dusty
July 20th, 2012
4:46 pm
Some people are stupid @4:31
I don’t think you “understood” that hiring people costs companies money at all. You had an idea that hiring a bunch of people would give the magic word “jobs”. Now you back off.
Not all small business owners start up with debt. The ones that do are probably the ones closing the business as their homes are being. foreclosed.
Our president is supposed to be running one of the largest countries in the world. I hope he isn’t trying to run it like a start-up in debt small business.
On second thought, that may be exactly what he is doing. I’m for shutting down his “business” before we are all in Chinese foreclosure.
md
July 20th, 2012
4:51 pm
“Not really, the regulation created the demand rememeber.(See SOX example)”
No….the regulation demanded that the corp increase it’s expenses to comply…..which does not equate to shipping that work elsewhere.
In your example, it is an increase in expenses…..a corp may keep all that in house or outsource some of it…..but remember, outsourcing it will cost corp A even more money….so in your example, B may get another job but A had to have a person do the new work AND pay for the new outsourcing……if A only has xx dollars to spend, it’s a net loss.
Some people are stupid
July 20th, 2012
4:51 pm
Tiberius-
1. Initial discussion on this blog is regulations hurting small business form hiring correct.
2. My point regulations can lead to jobs.
3. your point regulations cost the company
4. my next point the cost to the company is the income to the other.
5. Regulation has to happen before a job can be created.
6. My point, I have to spend money before a job can be created, so what the difference.
7. In conclusion- it’s the same thing. I see your point, my counter-point is money out whether from you or a company is still money out that goes to someone or something else. Your cost is still my income. In the end, the net sum is more than likely still the same.
(most companies employed auditors prior to SOX. The whole free market, who would you trust kind of thing, an audited report vs an non audited report. )
Tiberius - pulling the tail of the left AND right when needed
July 20th, 2012
4:51 pm
Off to engage in some commerce.
VOLUNTARY, UNREGULATED commerce.